S&P: Rockies Express view negative

S&P said it affirmed the BB+ corporate credit and senior unsecured debt ratings on Rockies Express Pipeline LLC.

The agency also said it revised the outlook to negative from stable.

The 4 recovery rating on the senior unsecured notes is unchanged and indicates 30% to 50% expected default recovery.

The outlook revision reflects the impact the recent Encana contract renegotiation is expected to have on the company’s near-term credit metrics, S&P said.

Offsetting this is the company’s ability to extend the tenure of these contracts through 2024, which improves the weighted average length of the contracts and mitigates a large percentage of the cash flow cliff risk associated with the legacy west-to-east volumes in 2019, the agency said.

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